All three major stock indices opened sharply lower Monday with the Dow Jones Industrial Average opening down 979 points before posting a slight recovery in early morning trading.
The Dow was down some 780 points while the S&P fell by 2.6% and the Nasdaq took a hit of nearly 3%, all on fears over the global spread of the new coronavirus.
The virus is surging in South Korea, Iran and Italy after it emerged in China in December. Beijing has been grappling with its spread in the time since, and has reported nearly 2,600 deaths amid an economic slowdown prompted by efforts to curtail the disease.
Five people have been reported dead and 200 more infected in Italy as South Korea reports a growing tally, including 8 deaths and over 800 confirmed cases.
And in Iran, the death toll has risen to 12 with 47 confirmed cases.
Amid investor panic, billionaire business magnate Warren Buffet urged calm, saying the U.S. economy remains "strong" even if it is "a little softer than it was six months ago."
"You look at car holdings —rail-car holdings, that's moving goods around. And there again, that was affected by the tariffs, too, because people front-ended purchases, all kinds of things,” Buffet told CNBC. "Business is down but it's down from a very good level."
Outside mainland China, the coronavirus has spread to more than 25 other countries including the U.S., the U.K., Singapore, France, Russia, Spain and India.
The World Health Organization has declared the outbreak an international health emergency.